Telecom reforms increase competition

The European Union is set to launch new proposals to reform the telecoms sector, in a bid to increase competition and create a single market.

Draft proposals are expected to include plans to create a regional watchdog and give Brussels greater power to change the decisions of national regulators.

The plans, set to be announced on Tuesday, will need to be approved by the EU’s 27 member states, reports the BBC.

However, analysts said there is likely to be opposition to the changes.

John Davies, a telecoms analyst at Dresdner Kleinwort, said that several national governments are opposed to the idea of giving more powers to the European Commission, the executive arm of the European Union (EU).

“There is scope for the final version to be quite a lot different,” he added.

Germany and Spain are seen as strong opponents of certain aspects of the plans.

‘More power’

The driving force behind the changes is the EU view that more consistency between member nations’ telecommunications legislation is needed.

The Commission wants the power to override a national regulator’s decision regarding a competition issue if it believes it is inadequate.

It has also argued that technological developments mean there is a need to review regulation, especially as technology is moving away from more traditional fixed-line services that rely on copper wire infrastructure.

Part of this shift would see firms having to separate their network and service businesses.

“There will be changes, and probably a bit more power ending up in Brussels,” Dresdner Kleinwort’s Mr Davies explained.

“But the key part will be that regulation will be less focused on copper and more flexible to cope with different access methods such as fibre or wireless.”

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